Kmart shopping for groceries 10-27-98

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} Tuesday's Top Stories Kmart shopping for groceries

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NEW YORK (CBS.MW) -- Kmart (KM)
km
is shopping for a grocery chain, The Wall Street Journal reported Tuesday. Kmart Chairman Floyd Hall told analysts last week that the discount retailer has been seeking a merger partner to help it expand its food sales following the success of Wal-Mart (WMT)
WMT, +0.63%
. The Journal said an analyst at BT Alex. Brown confirmed that Kmart had been in discussions with Albertson's (ABS)
ABS, -1.67%
and American Stores (ASC)
ASC, +1.48%
to reach a three-way deal. The two grocery chains agreed to a $8.4 billion deal without Kmart, but revealed in a federal filing recently that an unnamed third party had been interested. Analysts told the Journal that Safeway (SWY)
SWY, -2.50%
and Ahold N.V. (AHO)
aho
are likely candidates. However, Kmart may not be attractive as a partner because of its low margins, they said. (The Wall Street Journal)

Fed's Poole says credit crunch easing

WASHINGTON (CBS.MW) -- St. Louis Fed President William Poole said there are signs the credit crunch may be easing, a signal that further interest rate cuts may not be forthcoming, The Wall Street Journal reported Tuesday. Poole has always been an inflation hawk, voting in the Federal Open Market Committee to raise interest rates in May, but he backed off that stand in June and August. It is not known how he voted when the FOMC lowered rates in September. Other Fed officials, notably New York Fed President William McDonough and Gov. Laurence Meyer, have signaled recently that more rate cuts could be coming if financial markets do not stabilize. (The Wall Street Journal)

Soros to close emerging market fund

LONDON (CBS.MW) -- George Soros, the international financier, has unveiled a major restructuring at his Quantum hedge fund group following several months of poor performance and the ill health of one of his senior fund managers, the Financial Times reported. Soros has told investors that he intends to close the Quantum Emerging Growth Fund, one of eight in the $20 billion U.S.-based Quantum group. It has suffered poor investment performance recently and is down 31 percent this year with a current net asset value of $1.5 billion, the FT said. (The Financial Times)

Japan unemployment at record high

TOKYO (CBS.MW) -- The ratio of job offers to job seekers in Japan declined 0.01 point to 0.49 in September, falling below 0.50 for the first time since the statistic started to be compiled under the current method in 1963, the Nikkei Evening News reported. Meanwhile, the country's jobless rate remained at a record-high 4.3% in the month on a seasonally adjusted basis. The number of jobless people totaled 2.95 million, the Nikkei said.

Japan stimulus package in sight

TOKYO (CBS.MW) -- The Japanese government decided at its Tuesday Cabinet meeting to formally adopt a package of emergency economic stimulus measures on Nov. 16, just before a conference of the Asia-Pacific Economic Cooperation forum in Kuala Lumpur, the Nikkei Evening News reported. The government will speed up its work on the latest economic package intended to revive the domestic economy. At the Cabinet meeting, Prime Minister Keizo Obuchi revealed his intention to expand the size of special budgetary allocations designed to spur the economy from the originally planned 4 trillion yen, and instructed respective ministers to work out concrete plans for additional spending.

U.K. Treasury pushes for rate cut

LONDON (CBS.MW) -- Stephen Byers, chief secretary to the Treasury, said he hoped for "significant" moves by the Bank of England to cut interest rates in the next few weeks, the Financial Times said. Speaking on the day after a European summit called for a co-ordinated push to stimulate growth, his statement brought accusations that he was attempting to influence next week's meetings of the bank's independent monetary policy committee. "We hope interest rates have peaked at 7.5 percent, and that they are now on their way down," he was quoted as saying. The bank cut rates a quarter point to 7.25 percent this month, following five quarter-point rises since Gordon Brown, chancellor, granted the bank operational independence in May last year. (The Financial Times)

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